Wholesaling Real Estate: How To Invest With No Money
You're likely here because you want to learn more about wholesaling real estate and how to invest with no money. Well, you're in the right place.
I'm going to show you what wholesaling real estate is and how you can get started today with no money!
No tricks, courses or fluff here.
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What is Wholesaling Real Estate?
Wholesaling real estate is a way for you to dip your toes into real estate investing with little or no money.
Wholesaling has been around for a long time, but it has really taken off in the past 5 years. Why is it becoming so popular? Well, the barrier to entry is extremely low as you can wholesale with very little or no money!
Let's try to keep this somewhat concise.
Wholesaling real estate is when you find a homeowner looking to sell their property and connect them with a cash buyer who's willing to buy the property. You’re essentially the middle man or matchmaker.
Why do the homeowners need your help?
These homeowners are usually distressed for one reason or another, including late on taxes, being foreclosed, a divorce or death in the family, etc.
Whatever the reason may be, they want to sell their home and usually need to sell it fast. A foreclosure can tank their credit score and lead to further issues long-term.
This, along with not wanting to pay high realtor fees is the reason that wholesalers are able to successfully come to the rescue.
Since these homeowners need to sell fast, they are often willing to sell at a steep discount and this makes for an incredible opportunity for cash buyers. Especially if the cash buyer can close fast.
"Wholesaling real estate is a great way to dip your toes into real estate investing without much capital or risk"
An example of wholesaling real estate
John lost his job and was unable to make his mortgage payments. The bank is going to foreclose on his house in 3 weeks so John wants to sell to pay off his mortgage.
This way he can avoid his credit tanking. He doesn’t have time to list it on the market or the money to work with an agent.
He’s willing to sell his $200,000 home for $130,000 if the buyer can pay cash and close fast. You sign a purchase agreement for $130,000 with John with the rights to assign the contract to a cash buyer.
You then find a cash buyer to assign the contract and buy the property for $150,000. The cash buyer agrees to pay $130,000 to purchase the contract and a $20,000 assignment fee to you.
They both meet the day of closing to sign any final paper work and you walk away with a $20,000 assignment fee.
It's really that simple. However, competition is fierce with the low barrier to entry. Most investors start wholesaling real estate on their way to other endeavors.
Ways To Find Cash Buyers
4. Your Website
5. Join Local Real Estate Meetups
6. Local Real Estate Agents
7. Real Estate Software (Propstream, Flipster, REIPro, etc)
Assigning The Contract vs Double Closing
Real Estate Agent vs Wholesaling Real Estate
Being a real estate agent is a dream for some people because this career is quite promising and provides high income. You have minimal risk and are essentially just helping the end buyer complete the transaction.
You don't need capital because you are basically selling someone else's property. In this case, you can get a commission from the sale.
However, this is not the only way to make good money in the real estate industry. Wholesaling real estate provides endless opportunities and you can get started with no money!
Real estate agent must be very careful if they are involved with both. Having a conflict of interest could be very bad news. Always disclose and do what's right for the client.
How Much Money Can You Make Wholesaling Real Estate?
There are a lot of variables when it comes to how much money you can make wholesaling real estate.
Most real estate wholesalers aim to get between $5,000 and $10,000 per deal. Personally, I'll take a $2,000 deal if it presents itself.
It's not ideal, but with minimal work or effort, that's an amazing pay day. It's also efficient with the assignment of contract.
Is there a way to make more money wholesaling?
Real estate wholesalers can also choose a double-closing strategy. This often results in $20,000+ transactions.
Both strategies are dependent on your negotiating skills and ability to find homeowners looking to sell.
There have been investors wholesaling real estate who have done over $100,000 deals. The more distressed the homeowner is, the better your chances of landing a good deal.
However, wholesaling isn't a great fit for everyone.
If you're just looking for a way to make money, check out my newest article: 33 ways to make money online.
If you can solve problems, the money will follow.
Wholesaling Real Estate is a great way to dip your toes into real estate investing without much capital or risk. The upside is tremendous with very low risk to the investor when done correctly. This is why wholesaling real estate has grown so much in the past 5 years. However, I strongly encourage you to get into the business to help distressed sellers and solve their problem. Don't get into this solely for the money. If you can solve problems, the money will follow.
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